NALC Health Insurance – Has the System Failed? Part 2
NALC health insurance, or National Association of State Health Department Certifying Agencies, is a group that offers health insurance for state residents. The association has branches throughout the country. One of those branches, or nalc, is in Pennsylvania. As you might expect, when looking for nalc health insurance in Pennsylvania you will find both bigger companies and smaller carriers.
If you look at Nationwide, or one of their other big names, you’ll see a wide range of coverage from Aetna, Celg, Humana, Blue Cross, Delta, Assurant, and Celtic. Most people don’t understand that all of these carriers sell insurance in different ways. Delta, for instance, does not sell health insurance through agents, but through an agent referred to as a “specialist broker.” This same specialist broker, or specialist, will be in charge of selling any Aetna, Humana, Blue Cross, Delta, or Assurant plans that are offered by this particular company. So, it’s clear from the above which carrier would be more likely to sell you nalc health insurance through its special nalc health insurance agents in Pittsburgh.
Nationwide is a member of the National Association of State Health DepartmentCertified Public Accountants (NASSCA). One of the rules that the association goes by is that each carrier must participate in a nalc or convention of insurance company. A convention of insurance company means that the company has signed up with a larger nalc branch in another state. One example of a convention is United Healthcare, Inc. (UTHI). The association also requires carriers to sell nalc policies directly to the customers rather than through independent agents.
According to the article cited below, United Healthcare is a member of the “powerful nalc group”. United Healthcare is also a member of the National Association of State Health Department Certified Public Accountants (NASSCA). NASSCA is the largest association of states in the United States. If United Healthcare is a member of NASSCA, how can it be that a nalc policy sold by the nalc company is sold via agents in Pittsburgh? According to the article referenced below, “the nalc policy is made available directly to the customers via a nationwide network of nalc brokers who are independent of any one specific insurance company and work at a fixed fee”.
Now let’s see what’s going on with these “rogue nalc agents” in Pittsburgh. One evening, we had a gentleman that was shopping for health insurance from his employer, Jeff Rainey. Jeff was nice enough to leave his name as the insured on his insurance policy, along with his date of birth and social security number. He was referred to as a “rogue nalc” by his nalc agent in Pittsburgh.
The next day, we had another gentleman who’d purchased nalc policy from the nalc broker in Pittsburgh. This nalc agent had told the man from our company that he didn’t know how to get coverage under the convention, which was a pretty accurate description of the situation. From the information we’d received, we figured that there were about 30 nalc members from our state that used the postal service to purchase nalc policies from nalc brokers in Pittsburgh.
A few days later, I had another discussion with my health advisor, Mr. James McAfee, about this whole situation. Mr. McAfee is a former chief technology officer for AOL. He’d worked his way through the IT department of AOL and then went on to become a vice president for Microsoft. In addition, he’d served as a corporate executive for three years. As a result, he knew all of the nalc issues and he knew quite well what the recording secretary was up against.
When I explained the situation to him, Mr. McAfee said he really didn’t know how to answer my question, because he didn’t understand the carriers and the NALC. But he did know that the recording secretary was up against some really talented nalc brokers who were familiar with the system. He also knew that a lot of people had been hurt at the convention because of the system. According to Mr. McAfee, the recording secretary’s weak performance had everything to do with the fact that most nalc members were from a region that didn’t have low rates to begin with.